( 07/03/09 ) Only The Cruise Control Portfolios have
been updated.
Short term CCP
Medium term CCP
( 06/26/09 ) The below chart of Institutional
Index ($XII) is declining and suggests scaling out
of long positions or hedging with shorts (
proshares.com ). The VIX volatility or
market fear index continues to decline but may be
misleading as a seasonal low is expected by the 2nd
week of July. Also the below SSX chart ( composite
of all 41 Fidelity sectors) has all Hurst envelopes
pointing Down, which is not a good sign.
The political attempt to have the IMF dump hundred of tons of
gold bullion on the market coupled with Gold's
strong overhead resistance is expected to prevent
any Gold breakout over the short term time frame.
( 06/12/09 )
The
SelectSectors Market
Indicators have deteriorated and caution is
appropriate. After a sharp market correction it is
always clear what action you should have taken.
Prediction before the Market correction is very
difficult and often we only have clues to the
impending market action. Presently the
market indicators are
issuing a double cautionary signal. Also, if you
study the market charts in detail , a very strange
but well defined wedge is forming. This event
coupled with the Summation Index forming a second
local top, suggests to put on shorts (
proshares.com ) and enjoy the summer.
Gold
could not penetrate it's overhead resistance and
continues to Decline. The U.S. Dollar also bounced Up
which added to Gold's difficulties. This Gold pullback may be
painful
and hedging or selling may be appropriate. Since creation of U.S.
funny money continues unabated, this pull back may provide another
buying opportunity.
The
20 yr Treasury
2x short ( TBT ) fund continues to move Up and may
be trouble for continuing the current market rally
as well as impacting the troubled Housing market.
The SelectSectors market Indicators
show the Nasdaq or High Tech market
to be stronger then the general market. The
Cruise Control Portfolio
(CCP) Tables identify the best risk adjusted trading
vehicles.
A cautionary flag
must be raised due to the current market mixed
signals. Money management and a trading plan
become the most urgent themes.
Some Suggestions:
1) Go to a market neutral position, with both long
and short positions. This allows you to safely tread
water which is a lot better than drowning.
2) Quickly sell or reduce any positions
posting large declines. (ie) Capture profits
3) Close out all long positions and buy short
positions. ETF short funds would be the trading
vehicle of choice.(eg) proshares.com
4) Close out all long positions and stay in cash.
This is safe in a decline but presents the problem
of how do you re-enter the market.
The real difficulty here is that math and
computers can identify the current issues that are
trending, but very little, if anything can be
predicted as to how long the current trend will
last.
The market player, if he is to survive, must
employ active money management techniques. (ie) Be
prepared to exit and possibly employ the opposite
trade. (eg) Employ the
Parabolic Stop & Reverse(SAR) technique or
simply exit when an 8% or so decline from it's
recent peak value occurs. Another method is to
exit when the current market price falls beneath the
Low of the past 10 or 20 market days.
A new Gold stock optimization chart and table
has been added to the Gold
page. Check it out.
Schippi continues to think
precious metals mining stocks and bullion are an important defense to
the U.S. Dollar Decline and the insane Banking and
Federal Reserve mismanagement.
Commodity ETFs are another way of hedging against the
Decline of the U. S. Dollar.
Below is a long term chart that displays the
recovery cycle after the previous big-crash. This
recovery was very choppy and took quite awhile
before a solid up-trend formed.
The U.S. Dollar Index chart requires serious
attention, as it's decline may trigger a rush into
alternative investments. Also, our Fed Chief,
"Helicopter Ben" is doing everything he can to end
the U.S. Dollars important role as the world's
reserve currency. Also note the below Dollar chart
has posted a Double Top formation which is not a
good sign.
Also, as the U.S. Dollar weakens foreign currencies are brought into
play.
Monitor the Currency ETFs.
Major Market Indices
